Friday, June 30, 2017

MoCo Council wants to enter student loan business, as Katz sounds alarm on County debt

Plan would create 
ITA-like
"Authority,"
with $20-30 million
start-up cost

After creating a barrage of new offices and six-figure staff positions in the last year alone, opening their own microloan bank, and committing Montgomery County to staggering financial liabilities on bus rapid transit and the Purple Line, the Montgomery County Council is now planning to enter the student loan industry. That's not a misprint, and today isn't April 1. But just four days before announcing its intentions, one Councilmember, Sid Katz, raised red flags on the County's massive debt load.

The Council's proposal would create a new Montgomery County Student Loan Refinancing Authority to refinance student loans, much like the Independent Transit Authority that was panned and ultimately defeated by taxpayer opposition. Such an Authority would potentially have all the features hated in the ITA concept - the ability to raise taxes, carry unlimited amounts of debt that could end up being dumped back onto the taxpayers, and a lack of direct accountability to voters. The specifics will be unknown until a final state bill to create the Authority (sound familiar from the ITA fight?) is written, but one detail known is that the Authority will have the power to issue bonds. It should be noted that no other county in the United States currently is involved in student loan financing.

Does it make any sense from a fiscal responsibility standpoint for Montgomery County government to enter the student loan business at this time? The assessment of Katz, the only Councilmember with real-world business experience, suggests the answer is, "No."

"I, candidly, am very, very concerned about the debt Montgomery County has," Katz said during a June 22 meeting of the Government Operations and Fiscal Policy (GO) Committee. "If we don't get a handle on this, if we don't get a blueprint on debt in Montgomery County, it's going to overtake us. Right now, if [our debt] was a department, it would be the third largest department in Montgomery County."

Katz also expressed concern with the uncertain revenue forecast for the coming years. Trump administration cuts to government could drastically reduce income tax revenue for the County, Katz noted. Montgomery County is locked in a structural deficit as far out as the forecasts go - meaning that, as it is now, we already will be in the red every single fiscal year.

In the context of these red flags, a report by the County Office of Legislative Oversight raises many concerns.

How much would it cost taxpayers to launch the Authority? "The Montgomery County Department of Finance has estimated that a Montgomery County Student Loan Refinancing Authority would need $20 to $30 million to start a $100 million refinancing program," the report states.

The report confirms that these start-up funds "would impact the County’s debt levels (the amount the County can borrow)."

It appears loans would be extended to illegal immigrants, according to Page 4 under "Eligibility." On Page 6 of that section, it floats the idea of requiring a co-signer "if a borrower is not a U.S. citizen." In other words, resident taxpayers would be paying to provide low-cost student loans to non-taxpaying, non-resident students. Wow.

Later, the report notes that there are already numerous private student loan refinancing firms, and that their interest rates are actually less than the state-run loan entities the Council wants to ape. Why would we enter a market where there is no vacuum, with a more expensive product? Nuts.

A response from the office of County Executive Ike Leggett wisely pans the idea of entering the student loan business. "Student loan debt is the largest and fastest-growing share of consumer debt, and has the highest delinquency rate of all consumer credit debt," wrote Timothy Firestine, the County's Chief Administrative Officer, on behalf of Leggett. "As a result, there are few states and no localities willing to incur the financial risk and significant cost of operating a Student Loan Refinancing Authority."

Creating such an authority would "seriously impact many of our critically-important programs, ranging from K-12 education to safety and transportation," Firestine added. Starting it up would likely require the County to issue more debt, he said, and budget cuts in other areas would be needed to fund start-up costs, he wrote.

Thursday, June 29, 2017

Another MoCo DLC employee busted for stealing $20K+ of liquor from DLC trucks

Kelvin Snowden, Jr., a
Montgomery County DLC employee
police say stole liquor from DLC trucks
Montgomery County's government liquor monopoly is embroiled in yet another scandal. One of their employees was arrested by Montgomery County police yesterday, and charged with stealing $21,769 worth of liquor from the Department of Liquor Control's own trucks.

Police say Jean Auguste, 27, of Lanham, and Montgomery County Department of Liquor Control (DLC) employee Kelvin Eugene Snowden Junior, 31, of Gaithersburg, took the alcohol from box trucks parked at the Department of Liquor Control warehouse, which is located on Edison Park Drive in Gaithersburg. The alleged thefts occurred between Valentine's Day and May 28 of this year.

Montgomery County police responded to the last of what detectives say were 8 total thefts from the DLC warehouse site on May 28, and caught Auguste parked nearby in a Chevrolet Suburban, with cases of DLC liquor in the vehicle. The ensuing investigation led them to Snowden, who they say was the main thief who actually broke into the DLC to steal from the trucks. Snowden also allegedly sold stolen DLC liquor to Auguste on at least one occasion.

This is not the first time a DLC employee has been arrested for stealing liquor from the DLC. In 2014 and 2015, employees were caught stealing alcohol and were fired. Many have called for an end to the outdated Montgomery County government liquor monopoly, which has proved inept, internally corrupt, and expensive and tedious for bars and restaurants to purchase alcohol through.
Councilmember Hans Riemer
was at the center of a previous DLC scandal
County Councilman Hans Riemer was also ensnared in a 2014 DLC scandal that came to be known as "Beerghazi." Riemer appeared to be aware of criminal activity within the DLC - but instead of reporting it immediately to authorities, he kept quiet until after he was safely reelected in November 2014.

Less than 48 hours after the polls had closed, Riemer then appeared in a formal, sit-down interview with NBC 4 in which he attempted to then use the information he had withheld to promote himself as a crusader against DLC corruption. It was clear that the NBC 4 investigation had occurred long before Election Day, and that Riemer had been in on the reporter's investigation all along. But with Riemer having direct oversight of the DLC, revealing the criminal activity in the department before Election Day could have damaged his chances of reelection.

Riemer had previously claimed it was time for the government to get out of the liquor business. But in 2015, he flip-flopped and suddenly endorsed maintaining - and strengthening - the government liquor monopoly. And here we are today, with the same Jurassic World government monopoly liquor system, and another DLC employee behind bars. "Helpless" Hans Riemer strikes again!

Wednesday, June 14, 2017

Small business event to discuss:"Is your business or family safe in a sanctuary county?"

How do sanctuary immigration policies affect small businesses? That topic will be discussed at the next networking social event of the Small Business Action Network of Montgomery County, on Wednesday, June 28, from 6:30 to 9:00 PM at Hunter's Bar and Grill, located at 10123 River Road in Potomac.

The speaker will be Jonathan Hanen, who the event announcement says will discuss the question, "Is your business or family safe in a sanctuary county?" Montgomery County has been designated by the federal government as a sanctuary jurisdiction.

Recent crime headlines in the County make this a timely discussion, and the County has been blasted by the U.S. Department of Justice and U.S. Immigration and Customs Enforcement (ICE) for not honoring ICE detainers on criminal illegal aliens. ICE said the County put its agents and the community at risk when it recently allowed a man with an ICE detainer who had stolen an assault weapon from a police cruiser to go free, forcing ICE agents to locate and take him into custody in an uncontrolled setting.

SBAN-MOCO is inviting small business owners from across Montgomery County to attend.

The cost to attend the event is $15. The cost to join SBAN-MOCO is $25. There will be a cash bar. Space is limited - to reserve a spot, email your RSVP.

Monday, June 12, 2017

MoCo drags feet on correcting illegal traffic signals, refunds for drivers wrongly ticketed by red light cameras

Montgomery County still has illegally-timed traffic signals, which could be issuing unwarranted red light camera tickets to drivers, a recent report by the County's Office of the Inspector General found. On Friday, Delegate Marc Korman (D - District 16) asked County Executive Ike Leggett to consider an outside audit of its signal timing (the OIG had to rely on the word and data of the County Department of Transportation), turn off any cameras ticketing at an illegally-timed signal, and to begin reimbursing drivers who were wrongly ticketed at those intersections.

After being caught ticketing drivers with illegal signal timing in 2015, the County initially resisted adopting the Maryland-required yellow light time of 3.5 seconds. It then promised to correct the problem. However, the OIG report - based on MCDOT data not confirmed by an independent audit - found that 13% of signals countywide are still illegally timed.

When asked by the OIG for a schedule for correction of those 105 remaining signals, MCDOT refused to produce one. And while MCDOT insists that there are no red light cameras at the out-of-compliance intersections, the OIG noted that "We did not test or verify the accuracy of the information provided by MCDOT."

"Improper timing of traffic signals at locations with red light cameras goes to the heart of the confidence people can have in their government," Korman wrote in his letter to Leggett. 

Montgomery County responded to the OIG report with a one-sentence promise to create a schedule for signal correction, but did not say when such a schedule would be released. Once again, Montgomery County seems unable to deliver the basic functions of government - collecting the trash, clearing snow from sidewalks along its properties (sometimes as long as a month(!) after the snowstorm ended), plowing roads, providing 911 service or completing construction projects on-schedule (with the Wheaton Library being the latest, now a year-and-a-half behind-schedule).

Tuesday, June 6, 2017

Double murder in Montgomery Village

Montgomery County police detectives are investigating a double homicide in Montgomery Village. The victims were killed inside an unspecified model vehicle parked in the 8200 block of Gallery Court around 10:45 last night. Police were alerted by a 911 caller in the area who heard gunfire. Both victims died at the scene, detectives say.

Police have not yet released the identities of the two victims.

Detectives urge anyone who may have information about this double homicide to contact the Major Crimes Division at 240-773-5070.  For those who wish to remain anonymous, Crime Solvers of Montgomery County is offering a reward of up to $10,000 for any information that leads to the arrest of the suspect(s).  Tipsters can call Crime Solvers of Montgomery County toll-free at 1-866-411-TIPS (8477).

Wednesday, May 31, 2017

Taxpayers left holding the bag for $45 million in Silver Spring Transit Center fiasco settlement

Is this a thing of beauty, or what?
Montgomery County taxpayers are left holding the bag in the Silver Spring Transit Center debacle settlement agreed to yesterday. County officials attempting to cover-up their failure to conduct their oversight role on the project filed a weak lawsuit in a case where they themselves were mostly to blame.

The result? Realizing they could not win, the County's ultra-expensive legal team reached a chump change settlement worth a paltry $25 million. That leaves you, the taxpayer, holding the bag and paying $42 million for the remainder of the $47 million in cost overruns, $20 million in damages, and $10 million in legal fees. The settlement also requires the County (a.k.a. you, the taxpayer) to pay $3 million to Foulger-Pratt to settle their countersuit, which was directly caused by the incompetence of the County and County Council. You are now on the hook for a total of $45 million.

The surrender settlement, while inevitable given the County's woefully-weak case, was a total betrayal of the promises made by County Executive Ike Leggett and the County Council. Leggett stated he would not leave taxpayers on the hook for even a penny of the cost overruns. Councilmember George Leventhal promised the Brickyard Coalition in 2014 that he would "ensure taxpayers will not be on the hook for the remediation of the transit center." Councilmember Hans Riemer said in April 2013 he would "protect the taxpayers."

Once safely reelected, Leventhal and his colleagues abruptly turned around and made multiple new appropriations of tens of millions of dollars for the transit center. The taxpayers be damned!, was the clear message from the Council.

On Election Day 2018, voters will deliver the overdue "rough, seat of the pants estimate" Leventhal and his colleagues asked for in January 2015 - with a steel-toed boot.

#LockThemUp

Friday, April 14, 2017

Despite fake news headlines, you won't be buying liquor at grocery, drug or convenience stores in MoCo



You may have seen fake news headlines over the last few days trumpeting that "liquor" will soon be sold at "privately-owned stores" in Montgomery County. The careful wording was designed by the Montgomery County political cartel, to give casual readers the false impression that beer, wine and spirits would be coming to the shelves at Giant, CVS, 7-Eleven, etc. Nothing could be further from the truth, and it was surprising that many in the local media enabled the deception with false headlines. This is one of the more audacious public misinformation campaigns I've ever witnessed from the MoCo cartel.

Here are the facts:

The Maryland General Assembly just passed a bill which will only allow privately-owned beer and wine stores to sell liquor. Clever language in the bill specifically excludes grocery stores, drug stores, and convenience stores. Even popular convenience stores that currently sell beer and wine, like Talbert's in Bethesda, will be ineligible to sell liquor.

Even those beer and wine stores that qualify to sell liquor under the bill will still have to buy that liquor from the Montgomery County Department of Liquor Control - the government monopoly. That means they will be competing on retail price directly with the Montgomery County government liquor stores. Merchants like Bradley Food and Beverage have pointed out in the past that such competition is unfair to the small private businesses being forced to compete with the same government-monopoly seller, who sets the prices they have to pay for stock.

The new law allows the DLC to decide the criteria for the granting of contracts with private beer and wine stores by itself, with no public input or transparency. DLC, in other words, can decide the terms of competition itself. Profits for whichever few retailers DLC decides to "compete" with will likely be limited by the monopoly control over price, and that means no savings for you, the customer.

It's also unlikely that private beer and wine stores could be competitive with County-owned liquor stores on inventory, because the County stores are physically larger than stores which have been only allowed to sell beer and wine. And they'll still have to deal with the same DLC inventory and delivery problems that have hampered their existing beer and wine sales.

Once again, County politicians have tried to "look busy," even as they bolster and preserve the government liquor monopoly. Real change would be full privatization of beer, wine and spirit sales in Montgomery County, and being able to buy Bud Light or a bottle of wine at Safeway or Rite Aid. That did not happen with this new law.

Fact check score for fake news "liquor to be sold at privately-owned stores" headlines, designed to fool people who don't read the articles for the details?

Four Pinocchios/Pants on Fire